The Mythology of Uniqueness

Adding a geographic perspective to the affordable housing debate, the illusion of local limits our policy choices. The problem (i.e. lack of affordable housing) is framed as local. Thus, the solutions offered are local. But the demand driving up rents is not local, but global. Cities around the country and the world, in a variety of political geographies, struggle with the same issue. Such observations are not pause for thought, but deemed irrelevant. Your town is guilty of place failure, the reason why the rents are too damn high. Either fix the local or continue to struggle.

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In a similar vein, concerning spurring regional innovation, consider the mythology of uniqueness. Places, like people, thrive on a self-perception of exceptionalism. Looking into brain drain claims, I learned that the anxiety about native daughters and sons leaving is ubiquitous. Also universal is the sense that your hometown has it worse than anyplace else. Residents leave because something is wrong with place, which ignores the many places commonly deemed successful experiencing more dramatic out-migration. The same should be said for innovation. Why can't Pittsburgh pull a Silicon Valley? Because United States innovation is dying:

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For much of the last century, the United States led the world in technological innovation—a position it owed in part to well-designed procurement programs at the Defense Department and NASA. During the 1940s, for example, the Pentagon funded the construction of the first general-purpose computer, designed initially to calculate artillery-firing tables for the U.S. Army. Two decades later, it developed the data communications network known as the ARPANET, a precursor to the Internet. Yet not since the 1980s have government contracts helped generate any major new technologies, despite large increases in funding for defense-related R & D. One major culprit was a shift to procurement efforts that benefit traditional defense contractors while shutting out start-ups.

Bad procurement policy is just one reason the United States has begun to lose its technological edge. Indeed, the multibillion-dollar valuations in Silicon Valley have obscured underlying problems in the way the United States develops and adopts technology. An increase in patent litigation, for example, has reduced venture capital financing and R & D investment for small firms, and strict employment regulations have strengthened large employers and prevented the spread of knowledge and skills across the industry. Although the United States remains innovative, government policies have, across the board, increasingly favored powerful interest groups at the expense of promising young start-ups, stifling technological innovation.

The root of the problem is the corrosive influence of money in politics. As more intense lobbying and ever-greater campaign contributions become the norm, special interests are more able to sway public officials. Indeed, these interests have overpowered start-ups across the government—at the Pentagon, in the courts, and in various state legislatures.

The geography of the "innovation economy" reflects the largess doled out by the United States Department of Defense. That's the link between "bad procurement policy" and the supposed waning of America's "technological edge." In this sense, regional winners and losers were preordained as national policy was instrumental in driving innovation. Pittsburgh won't pop like Silicon Valley or Boston because of "a shift to procurement efforts that benefit traditional defense contractors while shutting out start-ups." The mythology of uniqueness obscures the exogenous forces shaping local policy outcomes.

The mythology of uniqueness also obscures the ubiquity of the industry life cycle curse. Innovation seems to thrive in an environment filled with small firms (i.e. "promising young start-ups"). Some of the small firms will be very successful and mature into large companies, dominating research and development. In Boston, Big Pharma gobbling up little biotech:

“Are we just becoming New Jersey north?” Harvard business professor Gary Pisano asked rhetorically, referring to a state dotted with Big Pharma campuses. “The big guys can be a draw for young companies, but you can get some crowding out. If the big guys come in and hire 5,000 people, smaller companies are going to have a harder time finding employees and affording space. And mid-sized companies become attractive targets.”

Does Boston really have a choice in the matter? The mythology of uniqueness says yes, Boston doesn't have to become New Jersey north. I say no. Where Big Pharma now rules (e.g. New Jersey, Connecticut, and Pennsylvania), there used to be a wealth of nimble start-ups. What makes Boston so special? As Big Pharma's innovation capacity predictably stagnates, Boston represents a feeding ground of fresh ideas. When one pasture is exhausted, move to another. Such is the nature of things, not a personality defect in Boston's character.